What does per annum mean?

Per annum means once per year. It is often used to describe interest rates.

Interest on savings

When you earn interest on your savings, it is usually calculated daily and then paid either monthly or per annum (annually). It's normally known as AER (Annual Equivalent Rate).

The amount of interest you earn will depend on whether it's simple or compound interest. Our savings accounts use compound interest. This means that you earn interest on money you deposit as well as any interest you've previously earned.

For accounts that only use simple interest, you would only earn interest on the money you pay in, but not any previous interest.

Even though the interest may be calculated on a per annum basis, it may be paid to you monthly.

Find out more about how interest rates work on savings accounts.

Interest on borrowing products

While you can earn interest on your savings, if you borrow money then you may have to pay interest on top of what you borrow. You will often have to pay interest on things like loans, credit cards and mortgages.

Find out more about how interest rates work on borrowing products.